HotSpots for BioTech Companies in the Bay Area
Facilities & Campuses designed for Life Science
The Bay Area can be split into three biotech sub-markets which include: Peninsula, East Bay, & Silicon Valley. Each of these sub-markets will offer more or less value to company depending on factors such as size, budget, workforce, and overall economic value. There are few facilities and campuses spread throughout the Bay Area and fewer landlords that provide service to the biotechnology & biopharmaceutical fields.
Peninsula
The Peninsula is traditionally home of biotechnology and is a premium area to conduct business. Stretching from South San Francisco to Redwood City this area is bounded by the UCSF to the north and Stanford University to the south. World class research universities such as the California Institute for Regenerative Medicine & the Gladstone Institute also reside in this sub-market.
Facilities located in this area can range from older space that was traditionally used as light industrial space -but converted to meet the needs of lab users- to brand new lab specific space. Mission Bay, which is being developed by Alexandria Real Estate Equities & Shorenstein Properties, is expected to contribute over 3 million square feet over the course of many more years. This space will come at a premium demanding some of the highest rents in the Bay Area.
Silicon Valley
The Silicon Valley has built a reputation as the high tech hub of the world. Wrapping around the south shores of the Bay, Silicon Valley encompasses Palo Alto to San Jose to Fremont. NASA Ames & the San Jose BioCenter are among those research facilities located within the area.
The obscene amount of growth in this area throughout the 1980’s and 90’s has lead to a large vacancy rate in R&D type buildings after the dot-com bust. Due to the large amount of R&D buildings available, many facilities in this sub-market are older and lack the amenities found elsewhere; thus the need for biotech build-outs is prevalent. Desired campuses for the life science user includes: McCarthy Center & Stanford Research Park, located in Milpitas and Palo Alto respectively.
East Bay
Sweeping from Hayward to Richmond and as far east as Pleasanton, the East Bay is becoming the rising star in value for biotech companies. This sub-market is home to UC Berkeley, Lawrence Laboratories, & Sandia Laboratories. Companies such as Bayer, Clorox, Chevron, & Kaiser have large campuses in the area. The draw of the East Bay for many companies includes commuter accessibility, affordable housing, lower lease rates than the Peninsula, a good assortment of building amenities, and the overall economic value. A generous mix of old and new facilities can be found, making second and third generation lab-specific build outs common and desirable as the lower cost alternative.
Emeryville & Berkeley hold prime location for many life science companies due to the close proximity to the University. These cities average exceptionally low vacancy rates and often some are the most expensive rents in the East Bay. EmeryStation –managed & owned by Wareham- is the most sought-after class “A” biotechnology space of the inner-most East Bay. EmeryStation is comprised of three different buildings and offers over 650,000 square feet of space, including a new 250,000 square foot building.
Alameda, located on the on the water, hosts a few biotech hot spots including Marina Village & Harbor Bay. Richmond is home to the Berlex Campus and many R&D type buildings. Both Alameda & Richmond in recent times have become the alternative to high rates in Emeryville and Berkeley.
Inland – Pleasanton, Dublin, & San Ramon- offers a large assortment of new space and hosts many corporate campuses; the rents tend to be economical in comparison to the rest of the Bay Area. With the growing number of life science businesses in the Bay Area, it is expected the East Bay will be home to those looking for the best value and those companies in the infantile stage of development.
With the development of the Easy Bay, the dynamics of the Peninsula may not hold fast forever. With an inadequate amount of space to build and ever changing lab standards & accommodations, revamped biotechnology facilities may fall short of what future companies will insist upon. Companies such as Genentech and Amgen continue to consume much of the newer development on the Peninsula, leaving a small margin for mid and small sized companies to grow affordably.
